System and method for distributing transformer capacity among transformer users

ABSTRACT

A method for utilizing transformer capacity allows multiple transformer users to have ordered access to the same backup transformer. When one of the users requires the use of a transformer, the users in line ahead of this user must exercise their rights to use the transformer or pass on their rights allowing the next user to decide whether or not to use the transformer. The method allows transformer owners to offer extra transformer capacity to those who desire backups while protecting their ownership interest and their need for the use of the backup. The method also provides those who need backup transformers a system to obtain access to the required backup without requiring them to purchase a new transformer or to wait for the transformer to be built.

CROSS REFERENCE TO RELATED APPLICATIONS

This application is a continuation of U.S. patent application Ser. No.10/142,408 filed May 9, 2002; which claimed priority from ProvisionalApplication Ser. No. 60/290,077 filed May 10, 2001, the disclosures ofwhich are incorporated herein by reference.

BACKGROUND OF THE INVENTION

1. Technical Field

The present invention generally relates to a system and method fordistributing electrical transformer capacity among different transformerusers. More particularly, the system and method of the invention allowsdisassociated transformer users to utilize spare transformer capacitywhile insuring that the transformer owner retains access to thetransformer when such access is needed by the owner. The inventionprovides a system and method for distributing options or rights ofrefusal to spare transformers among transformer users.

2. Background Information

Electrical power is one of today's most common power sources. Electricalpower is used in essentially every home and business throughout theindustrialized world. Electrical power generation facilities or powerplants generate essentially all of the electrical power used in theindustrialized world. Different types of power plants such as fossilfuel power plants, hydroelectric power plants, and nuclear power plantsgenerate electric power. Regardless of how the electrical power isgenerated, each power plant must distribute the electrical power to theusers of the electrical power. The distribution of electrical powerrequires the use of transformers.

Electrical power is distributed from power plants through distributionlines. As power is transmitted through the lines, the lines resist theelectrical current and generate heat. The resistance decreases theamount of electrical power transmitted through the lines. Powercompanies desire to minimize the power lost in the power lines. Tominimize power losses, power plants transmit electrical power at highvoltages which decreases the amount of current required to distributethe electrical power. Power plants use step-up transformers to increasethe voltage of the power generated by their generators. After the powerhas reached its destination, a step-down transformer is used to reducethe voltage to a usable level. The destination may be a local powergrid, an individual company, or a specific device. Each of thesedestinations may require a different voltage and aspecifically-configured transformer.

In the United States and Canada, there are thousands of electrical powergeneration facilities that are typically called electric utilities. Overthe past hundred years, most electrical utilities have been regulated bya government that prevented the utility from competing against otherelectrical utilities for customers. As such, each electrical utilitycould easily pass on all costs to the consumers and each electricalutility could afford to purchase a backup transformer for eachtransformer in its distribution system.

Recent utility company deregulation has caused utility companies toreview the cost of generating and distributing power to consumersbecause each utility company is now competing against other utilitycompanies for customers. Deregulated utility companies thus cannoteasily pass on a cost of each expenditure directly to the consumer.Electrical utilities are also reviewing their assets to determine how togenerate income in addition to the income generated by sellingelectrical power.

In the newly deregulated power industry, each electrical utility musthave a backup transformer that is immediately available for each keytransformer in its distribution system. Immediate access to a backuptransformer is essential because a new transformer can take months to bebuilt, delivered, and installed. In the age of deregulation, theelectrical utility must purchase power from a competitor if a keytransformer goes down. The competitor will sell the electrical power tothe crippled electrical utility at the highest possible rate. A singletransformer failure can substantially reduce or eliminate a utility'sprofit. Backup transformers are thus financially essential. Backuptransformers are also required by insurers. In addition to typicalbackups, some insurers require redundant backup plans.

Although backup transformers are essential, the actual backups arerarely used because only a small fraction of transformers actually failfrom year to year. Furthermore, some transformer failures are immediateand unexpected while others are slow and can be anticipated. A problemin the industry is that no one can accurately forecast if a transformerfailure will be immediate or slow. The same warning signs are generatedby transformers that fail immediately as transformers that fail slowly.Thus, it is inefficient for an electrical utility to purchase a backuptransformer when the backup transformer may sit unused for years whilethe primary transformer continues to function. On the other hand, theelectrical utility cannot wait for the transformer to show signs offailure due to the extraordinary expense incurred if the transformerfails suddenly. The problem of replacing failed transformers isespecially unique because there may only be one or two replacementtransformers for a particular application in the world and thereplacement transformer may have to be specially built by a transformermanufacturer with a long lead time.

In the past, electrical utilities and other transformer users (such aslarge manufacturing facilities) have purchased and stored large numbersof transformers for backup. Today's deregulated electrical utilitycompanies cannot continue using this backup method and desire a newsystem for backing up their key transformers while allowing the users toderive income from their existing backup transformers.

BRIEF SUMMARY OF THE INVENTION

In view of the foregoing, the invention provides a method for utilizingtransformer capacity by allowing multiple transformer users to haveordered access to the same backup transformer. When one of the usersrequires the use of a transformer, the users in line ahead of this usermust exercise their rights to use the transformer or pass on theirrights allowing the next user to decide whether or not to use thetransformer. The method provides a mechanism for spare transformerowners to offer their extra transformer capacity to those who desirebackups. The method allows the transformer owners to offer their extratransformer capacity while protecting their ownership interest and theirneed for the use of the backup. The method also provides those who needbackup transformers a system to obtain access to the required backupwithout requiring them to purchase a new transformer or to wait for thetransformer to be built. The system allows those who need backuptransformers to obtain the required backup without paying for an entiretransformer. The system and method of the invention thus reducesinefficiencies that presently exist in the marketplace.

BRIEF DESCRIPTION OF THE SEVERAL VIEWS OF THE DRAWINGS

FIG. 1 is a schematic view of the system of the invention.

FIG. 2 is a view of the information required when a user wishes to lista transformer with the system.

FIG. 3 is a view of the information required by a user who wishes toobtain rights to a backup transformer.

Similar numbers refer to similar parts throughout the specification.

DETAILED DESCRIPTION OF THE INVENTION

The system of the present invention is depicted schematically in FIG. 1and is indicated generally by the numeral 10. System 10 may be operatedand implemented over a wide area computer network 11 wherein each usermay connect with a central computer that is maintained by a systemadministrator 12. Of course, system 10 may be implemented without such anetwork by transmitting various information to all users via mail,phone, or facsimile. However, a network has the advantage that it allowsall users 24 hour access to the information and allows users to viewupdated information instantaneously. In the preferred embodiment of theinvention, system 10 uses the Internet to allow the various users ofsystem 10 to communicate with each other. Administrator 12 maintains theinformation used by system 10 on software that resides on a servercomputer 14. The software provides a matrix 16 of information used bythe users of system 10.

Administrator 12 who is responsible for running server computer 14,updating the matrix 16 listing available transformers and variousoptions, and for distributing the transformers to the users of system10. Administrator 12 also may be responsible for the bookkeeping ofsystem 10. In one embodiment of the invention, administrator 12 may beresponsible for delivering or for arranging the delivery of atransformer to the user who needs the transformer. Administrator 12 mayalso determine the prices of the rights and the fees for using system10.

In one embodiment of the invention, system users are limited bymembership to system 10. In order to become a member and have access tosystem 10, a user must pay a membership fee to administrator 12. Themembership fee would be periodic (such as yearly or monthly) and wouldrequire the user to supply information about the user to administrator12 so that administrator 12 could at least perform proper bookkeepingactivities. In other embodiments of the invention, system 10 is madeavailable to the public. In this situation, a discount may be given tomembers. In another embodiment, the members of system 10 may review newlistings before new listings are made available to the public.

System 10 includes a matrix 16 that lists a variety of differenttransformers (transformer A, transformer B, transformer C, transformerD, etc.) that are available for sale, lease, and options. Matrix 16includes an overall list of general information about each transformer.Detailed information 17 may be linked to each listing so that a user maydetermine the exact specifics of a transformer listed on matrix 16.Matrix 16 may also list which user currently owns the transformer andwhich rights 18 are available to other users. Rights 18 may include suchinformation as the costs of subsequent options as well as the particularrights associated with each current option holder for a specifictransformer. In another embodiment, matrix 16 only lists thetransformers and the users must contact administrator 12 to determinewhat rights are available. Additionally, a purchase system is in placeto allow for the transfer of funds and in one embodiment the funds aretransferred directly to administrator 12 and in another system a portionof each option fund is removed and transferred to administrator 12 withthe remaining funds being transferred into a held escrow account so thatfunds are guaranteed to be returned from the escrow account should aearlier option holder exercise their option and subsequent exerciseholders moneys are returned.

System 10 can only function when transformer owners list theirtransformers with system 10. A first type of owner is a typicaltransformer user 20 who owns idle backup transformers. Another type oftransformer owner 22 is one who purchases commonly-used transformers andlists them with system 10 in order to profit from the ownership of thetransformers. Traditional owner 20 will only list his backup transformerwith system 10 if he retains his right to use the backup transformerwhen he needs it—otherwise, owner 20 would not risk losing his backup.System 10 allows owner 20 to protect his backup while generating incomeby selling options in the idle backup time of the transformer. Withrespect to owner 22, he does not need to protect a backup and does notneed to retain any rights in the transformer.

System 10 is initiated when a transformer owner 20 or 22 lists at leastone transformer on matrix 16. For the purposes of providing an example,owner 20 lists Transformer A and owner 22 lists Transformer B. An ownerlists the transformer by contacting administrator 12 and providinginformation such as the information depicted in FIG. 2. Once thisinformation is provided, the transformer will appear on matrix 16 forthe users of system 10.

We first examine how system 10 functions with Transformer A listed byowner 20. Owner 20 may list Transformer A for sale or for lease. Owner20 retains the first right of refusal when owner 20 lists theTransformer A. The first right of refusal gives owner 20 the option ofkeeping Transformer A if another system user wishes to purchase or leaseTransformer A. The right of first refusal may also allow owner 20 toforce the return of Transformer A when another user is leasingTransformer A. Such a right protects owner 20's backup requirements andgives him an incentive to list Transformer A.

In this situation, other users 24 interested in Transformer A willpurchase ordered rights of refusal (second, third, fourth, etc.). Users24 may request information about the transformers available on matrix 16by submitting the information depicted in FIG. 3. If a transformer isnot already listed, administrator 12 may obtain the requestedtransformer for system 10. Each user pays administrator 12 a monthly feefor owning the right of refusal. The fee for the second right may behigher than the third right and the fee for the third right may behigher then the fourth right, etc. Administrator 12 holds a portion ofthe money in an interest-bearing account until one of the usersexercises an option on Transformer A. Another portion of the money ispaid to owner 20 for listing Transformer A. This payment provides themain incentive for owner 20 to list Transformer A with system 10. Asdiscussed above, Transformer A would be a backup transformer that maynever be placed into service or may not be placed into service foryears. System 10 thus provides a method that allows owner 20 to generateincome from an otherwise idle asset.

If the owner of the third right of refusal indicates that he wishes topurchase or lease Transformer A, the owner of the first right of refusalmust decide whether to keep Transformer A or pass on his right. If thefirst right of refusal is exercised, the money paid by the users for thesecond, third, fourth, etc. rights of refusal is returned withoutinterest and less an administrative fee. The fee and the interest isretained by administrator 12. A percentage of the money paid to owner 20for the options must also be returned.

If the owner of the first right does not exercise his option, the holderof the second right of refusal is given the opportunity to exercise hisright to purchase or lease Transformer A (depending on the type ofoption he purchased). If the owner of the second right exercises theright, the lower right holders (third, fourth etc.) may get theirpayments back. If the second right owner passes, he loses his fees andTransformer A is controlled by the third right holder who initiated theprocess. All right holders behind the third holder then receive theirmoney back.

In the case of a sale, owner 20 will lose his right to Transformer A ifhe does not exercise his right of refusal. In the case of a lease, thefirst right of refusal may be designed to allow owner 20 to leaseTransformer A to one of the other users while retaining a right todemand the return of Transformer A upon demand (subject to reasonablenotice) if owner 20 requires Transformer A for his power system. Thistype of right would encourage transformer owners to list their backuptransformers for lease with system 10.

We next examine how system 10 functions with Transformer B listed byowner 22. In some situations, owner 22 may be the same entity asadministrator 12. Owner 22 would be an entity with spare transformersthat he can part with or an entity that purchases commonly-usedtransformers with the intention of profiting from the sale of the rightsof refusal, the leasing of the transformers, or the outright sale of thetransformers. Owner 22 may thus purchase a group of commonly-usedtransformers (Transformers B, C, and D) and price the options to pay offthe purchase price and create an income stream based on its ownershipinterest.

Owner 22 may list Transformer B for sale or for lease. Owner 22 wouldnot retain a right of first refusal because owner 22 has no need forTransformer B. Owner 22 thus offers the right of first refusal for saleto the other users of system 10.

In this situation, other users interested in Transformer B will purchaseordered rights of refusal (first, second, third, fourth, etc.). Eachuser pays administrator 12 a monthly fee for owning the right ofrefusal. The fee for the first right may be higher than the second rightand the fee for the second right may be higher then the third right,etc. Administrator 12 holds a portion of the money in aninterest-bearing account until one of the users exercises an option onTransformer B. Another portion of the money is paid to owner 22 forlisting Transformer B. If the owner of the third right of refusalindicates that he wishes to purchase or lease Transformer B, the ownerof the first right of refusal must decide whether to purchase or leaseTransformer B or pass on his right. If the first right of refusal isexercised, the money paid by the users for the second, third, fourth,etc. rights of refusal is returned without interest and less anadministrative fee. The administrative fee and the interest is retainedby administrator 12.

If the owner of the first right does not exercise his option, the holderof the second right of refusal is given the opportunity to exercise hisright to purchase or lease Transformer B. In this situation, the ownerof the first right forfeits his fees to owner 22 and administrator 12.If the owner of the second right exercises the right, the lower rightholders get their payments back. If the second right owner passes, heloses his fees and Transformer B is controlled by the third right holderwho initiated the process. All right holders behind the third holderthen receive their money back (less interest and administrative fees).

With respect to either owner 20 or 22 described above, administrator 12may apply a portion of the option fees against a lease or sale priceeventually paid by the entity who exercises his right.

In the foregoing description, certain terms have been used for brevity,clearness, and understanding. No unnecessary limitations are to beimplied therefrom beyond the requirement of the prior art because suchterms are used for descriptive purposes and are intended to be broadlyconstrued.

Moreover, the description and illustration of the invention is anexample and the invention is not limited to the exact details shown ordescribed.

1. A method comprising the steps of: listing an excess transformer ownedby a first owner, the listing offering property rights in the excesstransformer; selling ordered options for the listed excess transformer;allowing one of the option holders to trigger the exercise of theoptions; returning at least part of the option fees of all lower optionholders when a higher option holder exercises his option; and keepingthe option fees of the option holder who exercises his option.
 2. Themethod of claim 1 wherein the step of selling comprises the step ofselling ordered options for the listed excess transformer to respectivetransformer users as insurance against loss of electric power generationcapability due to failure of a transformer used by one the transformerusers.
 3. The method of claim 1 further comprising the step of providingexclusive use of the excess transformer to the holder of the optionexercised unless the excess transformer owner exercises a right todemand return of the transformer if leased to the holder of the optionexercised.
 4. The method of claim 1 wherein the step of sellingcomprises the step of selling ordered options for the listed excesstransformer exclusively to one of a group consisting of (a) producers ofelectrical power; (b) distributors of electrical power; and (c)producers and distributors of electrical power.
 5. The method of claim 1wherein the step of listing comprises the step of listing suitabilityinformation about the excess transformer which would assist a potentialpurchaser of an ordered option for the transformer in determiningwhether the transformer is suitable for the purposes of the potentialpurchaser.
 6. The method of claim 5 wherein the step of listingsuitability information comprises the step of listing at least one of agroup consisting of: (a) whether the transformer is a three phase or onephase transformer; (b) whether the transformer is oil type or dry type;(c) kilovolt ampere rating (KVA) of the transformer; (d) temperaturerise of the transformer; (e) class of the transformer; (f) primary tapspecifics; (g) primary voltage rating of the transformer and whetherdelta or Y connected; (h) secondary voltage rating of the transformerand whether delta or Y connected; (j) whether the transformer has a loadtap changer; (k) impedance of the transformer; (l) whether thetransformer was working when removed from service; (m) whether thetransformer failed while in service; (n) manufacturer of thetransformer; (o) serial number of the transformer; and (p) age of thetransformer.
 7. The method of claim 6 wherein the step of listingsuitability information comprises the step of listing each of the group.8. The method of claim 1 further comprising the step of transferringpossession of the excess transformer to the option holder who exerciseshis option.
 9. The method of claim 1 further comprising one of the stepsof delivering and arranging for delivery of the excess transformer tothe option holder who exercised the option.
 10. The method of claim 1further comprising the step of selling the excess transformer to theoption holder who exercises his option.
 11. A system for distributingtransformer capacity comprising: at least one transformer that isavailable for use by someone other than the owner of the at least onetransformer; a computer configured to generate a list of the at leastone transformer, said list being accessible by those that would like tobuy ordered options for property rights in the transformer; an accesssystem configured to provide access for viewing the list by others; apurchase system configured to allow the purchase of ordered options forany transformer on the list by others.
 12. The system of claim 11wherein the access system comprises a matrix of available transformersviewable over a network.
 13. The system of claim 12 wherein the networkis the Internet.
 14. The system of claim 12 wherein the list furthercomprises the ownership interest of other option holders for a giventransformer on the list.
 15. The system of claim 12 wherein the listfurther comprises the cost of subsequent options for a giventransformer.
 16. The system of claim 11 wherein the access system is alimited access system which allows only a group of members to view thelist.
 17. The system of claim 16 wherein the group of members consistsof one of (a) producers of electrical power; (b) distributors ofelectrical power; and (c) producers and distributors of electricalpower.
 18. The system of claim 11 wherein the purchase system isconfigured to allow the purchase of ordered options for any transformeron the list only by one of a group consisting of (a) producers ofelectrical power; (b) distributors of electrical power; and (c)producers and distributors of electrical power.
 19. The system of claim11 wherein the list comprises suitability information about the excesstransformer for assisting a potential purchaser of an ordered option forthe transformer in determining whether the transformer is suitable forthe purposes of the potential purchaser.
 20. The system of claim 19wherein the suitability information comprises at least one of a groupconsisting of: (a) whether the transformer is a three phase or one phasetransformer; (b) whether the transformer is oil type or dry type; (c)kilovolt ampere rating (KVA) of the transformer; (d) temperature rise ofthe transformer; (e) class of the transformer; (f) primary tapspecifics; (g) primary voltage rating of the transformer and whetherdelta or Y connected; (h) secondary voltage rating of the transformerand whether delta or Y connected; (j) whether the transformer has a loadtap changer; (k) impedance of the transformer; (l) whether thetransformer was working when removed from service; (m) whether thetransformer failed while in service; (n) manufacturer of thetransformer; (o) serial number of the transformer; and (p) age of thetransformer.